Amazon’s Security Lines for Workers Divide Top U.S. Court

Greg Stohr

October 8, 2014, 11:15 AM EDTUpdated on October 8, 2014, 3:56 PM EDT

The U.S. Supreme Court questioned whether workers at Amazon.com Inc. warehouses must be paid for time spent undergoing post-shift security searches in a case that will shape the power of employers over hourly workers.

Hearing arguments today in Washington, the justices suggested they are divided on the workers’ contention that federal law requires compensation for time spent in security lines. The hour-long session touched on topics as diverse as Amazon’s system for counting toothbrushes and a judge who required law clerks to cut his grapefruit.

The justices are considering a suit against a company that staffs Amazon’s facilities, filed by former workers in two Nevada warehouses. The case centers on the scope of a federal wage law.

Justice Elena Kagan emerged as the most likely vote in favor of the workers. She suggested the screenings helped Amazon with inventory control, meeting a test the court laid out in a 1956 decision requiring compensation for activities that are “integral and indispensable” to the job itself.

“What’s really important to Amazon is that it knows where every toothbrush in the warehouse is,” she said.

Other justices expressed skepticism, including Stephen Breyer, who said he was influenced by the Obama administration’s rejection of the workers’ position.

Minimize Costs

“Probably I’d say go with the Labor Department,” Breyer told the workers’ lawyer, Mark Thierman. “They are the ones who are in charge of this. And they are saying you lose.”

The case underscores the tension between employers seeking to minimize costs and workers who may suffer the consequences. While companies use the screening to guard against theft, employees say what’s being taken is their own time, for Amazon’s benefit.

The case may affect several pending lawsuits. Apple Inc., CVS Health Corp., J.C. Penney Co., TJX Cos. and Ross Stores Inc. are all battling similar cases involving either distribution centers or stores. Similar claims are also being pressed directly against Amazon.

The suit before the high court was filed by former employees of Integrity Staffing Solutions Inc., which provides temporary workers for Amazon.

Integrity’s lawyer, Paul Clement, said the security screenings are “materially similar” to the process of checking out at the end of a work day, something that longstanding Labor Department regulations say isn’t compensable.

Metal Detectors

The employees, Jesse Busk and Laurie Castro, say workers had to spend as much as 25 minutes after their shifts waiting to pass through metal detectors. “We’re not talking trivial here,” Thierman told the justices.

Amazon rejected that characterization. “Data shows that employees walk through post-shift security screening with little or no wait,” Kelly Cheeseman, a company spokeswoman, said in an e-mail.

Chief Justice John Roberts questioned Thierman’s contention that the security screening was a “principal activity,” entitling the workers to compensation under the Fair Labor Standards Act. “No one’s principal activity is going through security screening,” he said.

The “principal activity” argument prompted a discussion about grapefruit. It started when Kagan asked about an unidentified federal judge who years ago required his law clerks to “cut his grapefruit and otherwise make breakfast for him.”

Specific Task

She asked Justice Department lawyer Curtis Gannon whether that would be compensable. Gannon said it would be, though federal judges aren’t covered by the wage law.

Later, Justice Samuel Alito said the grapefruit scenario was different because it involved a specific task that the judge might hire someone else to do.

“But this is different, isn’t it?” Alito said. “Because you wouldn’t pay anybody just to come in and go through” a security line.

A federal appeals court let the suit proceed. If the Supreme Court sides with the workers, the case will move forward in a federal trial court.

Ultimately, Amazon and various staffing agencies it uses could be required to pay as many as 400,000 workers back wages amounting to $100 million or more, according to plaintiffs’ attorneys involved in the case.

Seattle-based Amazon, the world’s No. 2 online retailer by market capitalization after Alibaba Group Holding Ltd., has built a reputation for selling goods at low prices and delivering them quickly and inexpensively, with tiny margins.

That success rides on the company’s network of massive warehouses -- more than 40 so-called fulfillment centers in the U.S. alone, according to the company, staffed by 40,000 workers, swelling to 110,000 during the holiday season.

The case is Integrity Staffing Solutions v. Busk, 13-433. The court will rule by June.

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